- NZD/USD edged higher for the second consecutive session on Thursday.
- Softer risk tone benefitted the safe-haven USD and capped the upside.
- Investors now eye Trump-Biden face off for some meaningful impetus.
The NZD/USD pair traded with a mild positive bias through the mid-European session and was last seen trading near the top end of its daily range, around the 0.6665-70 region.
Following an early downtick to the 0.6630 area, the pair turned positive for the second straight session on Thursday and might now be looking to build on the overnight strong move up of over 100 pips. The uptick lacked any obvious fundamental catalyst and lacked any strong follow-through amid resurgent US dollar demand.
The latest optimism over the next round of the US fiscal package faded rather quickly amid the slow progress in stimulus talks and dented investors’ risk appetite. This was evident from a weaker tone surrounding the equity markets, which benefitted the safe-haven greenback and capped gains for the perceived riskier kiwi.
Negotiations between House of Representatives Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin are set to continue this Thursday. However, prospects for the passage of any substantial aid before the US presidential election remain dim amid strong opposition from Senate Republicans over the size of the stimulus bill.
Apart from developments surrounding the US fiscal aid, investors on Thursday will also focus on the final presidential debate between President Trump and his Democratic rival Joe Biden. In the meantime, the release of the Initial Weekly Jobless Claims data from the US will be looked upon for some short-term trading opportunities.
Technical levels to watch
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